Investment opportunities are all around you, and you’re likely familiar with the simplest and most common one—a savings account. Although it’s a safe choice, it isn’t the most profitable. Fortunately, there are more significant and beneficial opportunities out there!
Here are some of the best investment opportunities out there, regardless of your experience.
Stocks are the easiest investment opportunity to understand. When you buy shares of a publicly-traded company, you’re purchasing a piece of its success or failure. In essence, you make money when stock prices rise and lose money as it falls. However, stocks can become complicated fast since there are several ways to make money outside of selling stocks for a higher fee.
However it’s one of the broadest opportunities in the stock market. Whether you’re interested in the contractor business offering services like asphalt crack repair or in a rising international enterprise, you’ll have enough diversity to build a stable portfolio.
If you’re interested in investing in stocks but don’t want to choose individual businesses, go for Exchange-traded Funds (ETFs). They’re an excellent investment opportunity to own stocks without selecting the entities you’re investing on individually. Instead, you’ll be following a basket approach. Your ETF investment will be backing several companies, usually with a theme.
Investing in ETFs means you’re getting fractional shares of each business through the “fund vehicle.” All you need to do is pick the market, strategy, or sector. The best part is, ETFs are usually cost- and tax-efficient, boasting low fees—with some being free. They’re the perfect choice for investors with moderate risk tolerance.
Real estate is a profitable investment opportunity since there’s a finite amount of it. Plus, it has tangible value, offering you numerous ways to invest in real estate. You can purchase rental property and let people pay down the mortgage through rental fees while you benefit from the equity, or you can buy an old property and house flip it for a quick buck.
However, if you don’t want to manage physical properties, you can place money into a Real Estate Investment Trust (REIT). Keep in mind that real estate has cycles like other markets, so don’t hastily buy one and find the right time to sell the property. If you’re looking for a long-term investment, real estate is an excellent buy-and-hold asset.
Regardless of how long you intend on keeping the property, investing in real estate is one of the most stable choices out there.
Investing in cryptocurrency is relatively new, with bitcoin as the most popular one. However, there are countless others, including Litecoin and Ethereum. They’re digital currencies that don’t have government backing, and you can buy and sell them on through cryptocurrency exchanges. However, bear in mind that cryptocurrency has unpredictable fluctuations, making them extremely risky.
When purchasing a bond, you’re essentially lending cash to a company, organization, or a financial entity. In most cases, these “entities” are usually from a company or the government. Businesses typically issue corporate bonds, while local governments issue municipal bonds. While the cash is being lent, the lender can get interest payments. However, that can only happen after the bond matures.
The return rate on bonds is usually lower than for stocks since they’re generally lower risk.
Mutual funds are pools of several investors’ money invested in different companies. You can actively or passively manage this investment option. Actively managed funds usually have a fund manager who chooses securities to put the investors’ money. They’ll often try to beat a designated market index by picking investments that can outperform that index.
Meanwhile, a passively managed fund, known as the index fund, tracks a significant stock market index like the S&P 500. Additionally, you can use mutual funds to invest in various securities, including bonds, commodities, derivatives, equities, and currencies.
Startups and Initial Public Offerings
Investing in startup businesses is an excellent way to make money on someone else’s profitable idea. However, it can be risky for the very same reason. After all, not all great ideas pan out. Whether it’s placing a few hundred dollars into a friend’s new brick-and-mortar business for stakes in future sales or pooling your funds with an investment group—you’re buying access to future profits.
However, if you’re not keen on investing in a startup but like the idea, a great alternative is Initial Public Offering or IPOs. They’re an excellent way to cash in on the early stages of large-scale company investments. Owning a part of a business that goes public on the stock market means you’ll be compensated for the value of your ownership.
There are multiple investments to choose from, and some are ideal for beginners, and others require experience. Regardless of your experience, those investment options mentioned are some of the best opportunities you can put your money into—promising great returns.